3 Tax Planning Tips to Boost the Amount of Your Returns
Among all the aspects of running a business that you could encounter during your journey, none could be as pivotal as the efforts you take to maximise your profits. Thanks to the different pieces of technology, invaluable tools, new business practices, and refined strategical approaches that have come out in recent years, however, this task has become far easier than it was before.
While it may be safe to say that each method available is well worth investing your time in effort in, there’s no effort that could possibly get the job done better than adequate tax planning.
An introduction to profit-boosting tax planning
Although it may not necessarily be the newest play in the book, the craft of tax planning continues to remain an absolute necessity for any profit-boosting business project because of how fool-proof it truly is. As opposed to other “cost-saving” approaches that are packed with pitfalls and loopholes, this strategy maintains an effective approach that’s guaranteed to get all the right results as long as the necessary strategies are in place.
If you’ve been meaning to maximise your returns without spending a fortune on upfront costs or risk putting your company in hot water, here are three tax planning tips to start working with:
Tip #1: Start prepaying your expenses Among all the different places in the world where you could possibly do business, Australia ranks at the top of the list because of its leniency and offered privileges, especially when it comes to deductions for prepaid expenses. By taking the time to prepay some of the new fiscal year’s expenses that your business is expected to incur in the next 12 months, you can enjoy a deduction and take a chunk off your tax payable!
Tip #2: Capitalise on the opportunity to enjoy an instant asset write-off When it comes to tax planning, there’s a concept that could be more integral and non-negotiable than an opportunity to seek an instant asset write-off. By getting familiar with this concept and learning to immediately deduct the assets that you purchase for your business costing, you can enjoy the benefits of the current threshold and enjoy as much as $1,000 off your payables! Tip #3: Start reviewing your list of debtors and write off your unrecoverable debts
A common mistake that ends up costing Australian businesses in terms of tax costs is accidentally paying tax on unrecoverable debts from debtors they’re accumulated in the past. You can simply avoid this mistake by going over your list of receivables and following up with each debtor to see if they’re going to pay or if you need to write them off!
As challenging as the task of increasing your profits and ending up deeper in the green may be, there’s no more effective and worthwhile way to boost your margins than with a proper tax planning strategy. With the help of the three tips mentioned above, you’ll be able to cut out a significant chunk of your expenses and start seeing greater returns in no time! We’re a small business accountant in the Gold Coast that helps all types of businesses find their financial groove with our Xero accountant, outsourced bookkeeping, and tax accountant services. Give us a call today to learn more about the services we offer and how we can help you best meet your goals in no time!